“The average price for packet of 25 cigarettes was $35.14 in March 2018, compared with $31.68 in December 2017,” prices senior manager Paul Pascoe said.

Higher prices for accommodation services and petrol also contributed to the quarterly CPI rise, but they were slightly offset by seasonal falls for international airfares.

Tertiary education policy takes effect

Prices for tertiary education fell 16 percent in the March 2018 quarter.

This is the first time this series has fallen since 2003; it was due to the introduction of the Government’s fee-free first year policy.

The policy applies for all New Zealand secondary students finishing school from 2017 onwards, and adults who previously studied for less than half a full-time year of tertiary education or industry training.

Housing-related costs lead annual inflation

Housing and household utility prices increased 3.1 percent in the March 2018 year, led by construction and rents.

Construction prices increased 4.7 percent in the year, and 0.4 percent in the quarter. This was the smallest quarterly rise since the March 2011 quarter.

“Rising building prices in Auckland and Wellington have begun to slow. Both were up 0.3 percent in the latest quarter,” Mr Pascoe said. “For Auckland, this is the smallest rise since December 2012.”

Construction in Canterbury fell 1.1 percent in the March 2018 quarter as the market continued to cool.